Category → Incentives
Secretary of Agriculture Tom Vilsack visited biotech start-up Agrivida in Bedford, Mass. today to talk about USDA’s wise investments in R&D operations looking to make fuels from biomass. Prior to his remarks, he took a tour of the 40-employee firm’s lab space to see how they are spending some $3 million in government grant money. C&EN feels pretty wise, too, because it visited Agrivida almost a year ago for a similar tour.
The company was founded by two young entrepreneurs with freshly minted PhD’s in chemical engineering from MIT. Jeremy Johnson and R. Michael Raab found a way to engineer plants (the green variety) to produce the enzymes that cellulosic ethanol producers normally have to add to biomass to derive the sugars that can then be fermented into ethanol (got that?). Those enzymes can get pretty pricey, so if the plants can make them, then fuel producers might save a buck.
And saving a buck – especially if you’re in government – is all the rage these days. In his brief remarks, the Secretary said three times that his agency knows it needs to “spend less and spend wisely.” He said that government spending to spur innovation to make sugar-based fuels more cheaply – and competitive with fossil fuels – would help to “restructure the rural economy” and he predicted that “biorefineries will be dotting the landscape around rural communities” which will bring many jobs.
This week, USDA teamed up with DOE to award biomass R&D grants to eight projects that all have an eye on the bottom line. It’s clear that the government grant award-pickers are well versed on the financial (as well as technical) hurdles that the biomass-to-whatever industry faces. For example, the $5.1 million grant to Exelus, a firm in Livingston, N.J., will support “work to develop energy crops with improved tolerance to drought and salt stress to enhance yields on marginal lands,” and it will also ”redesign a process to make hydrocarbon fuels using new catalysts and chemistry that avoids the high temperatures and large energy inputs required by current processes.”
Metabolix is one of 8 firms and research organizations named in a Department of Energy grant program that will put $47 million to work making biomass more productive for fuels and chemicals. All in an effort, of course, to unhitch our economy from fossil fuels.
Metabolix already has a way to make bio-based plastics (polyhydroxyalkanoate, or PHA resins) from sugars, and has been doing it at commercial scale with agro partner Archer Daniels Midland. But it has also been spending a great deal of its resources upstream on the biomass end, and can grow switchgrass with PHA inside it.
The DOE award will give the firm $6 million (actually, it’s $6,000,001. not sure what the extra buck is for) to, in their words “use high temperature conversion to produce denser biomass and other products that can be further processed to make fuels such as butanol, chemicals such as propylene and other materials to improve the economic competitiveness of future biorefineries.”
I will admit to not fully grasping the meaning of “to produce denser biomass” yet, but I’ll be looking out for more details. Still, this announcement hit 7 of my cleantech topic categories (see above!) so it’s well worth mentioning now.
Metabolix was one of the earlier cleantech firms to IPO (helpful to do so before worldwide recession, is the lesson here). Laurence Alexander of Jeffries & Co. is a fan of the stock, rating the firm a “buy.” He had this to say in a note to clients about the DOE/Metabolix grant: “ We view the announcement as incrementally positive. It should help Metabolix strengthen its technology platform while reducing concerns that the early-stage research into the switchgrass PHA platform could represent a cash drain that detracts from the more timely PHA plastic and PHA-based chemicals platforms.” Sounds like Metabolix will be able to walk and chew gum at the same time, thanks to this announcement.
On a related note, the news value around the word “switchgrass” has been rather low of late. In this Google Trends chart, you can see little activity in last few years.
A great deal of attention in the biofuels segment has focused on cellulosic waste materials (wood chips, corn cobs etc) or gassification of biomass. Switchgrass was hot when the nation was going to grow dedicated crops for bio-based energy. We’ll have to see if a new research push will bring it back into the public eye.
One would have thought it would be absurd to try to find a silver lining in the week-long tragedy still unfolding in Japan. But the world’s investors have strong imaginations, apparently. Earlier this week while searching for cleantech news, I came across a number of articles describing a huge run up in share prices of solar firms.
Bloomberg now reports, “The Bloomberg Global Leaders Solar Index has risen about 9.1 percent since March 11, when an earthquake and tsunami in Japan knocked out cooling systems at a Tokyo Electric Power Co. reactor, releasing radioactive pollution.” But the piece quickly lets the air out of the balloon, saying “While the incident triggered speculation governments will scale back nuclear power in favor of renewable, solar panel demand is stagnating.”
Basically, after a doubling of solar installions last year – led by Germany – governments have ratcheted back the incentives that are the primary driver of demand for companies like U.S.-based First Solar. First Solar was one of the leading firms to receive positive fall-out from the nuclear disaster this week.
Because solar is not now the main focus of government interventions, any turning away from nuclear energy plans is more likely to benefit energy efficiency and natural gas projects, Bloomberg reports.
Yesterday, President Obama was at Penn State to press for more federal support of green buildings. In his speech promoting the Better Buildings Initiative, he suggested that many in his audience might not consider green buildings to be “sexy.” But I suspect that chemists have many reasons to find green buildings to be pretty darned appealing.
For one thing, green building materials research – like that conducted by a clean energy hub in Philadelphia headed by Penn State - can earn chemical firms a Presidential shout-out. The hub includes corporate partners Bayer Material Science, which is working on new materials for insulation and facades that save energy, and PPG Industries, whose researchers are creating walls that reflect sun and windows that reflect infrared, according to the President’s remarks.
He pointed out that making buildings (and homes) more energy efficient is a green upgrade that comes with no tradeoffs. The whole point of retrofitting (or building green from the start) is to save on energy costs. The roadblock, though, is the initial upfront cost, which is a cash expenditure. The President’s initiative - through tax credits and financing help – is supposed to minimize the up-front sticker shock. He’d like to pay for the cost of the program by rolling back “subsidies to the oil companies,” saying, “it’s time to stop subsidizing yesterday’s energy.”
Cellulosic waste to ethanol start-up Coskata will receive a $250 million loan guarantee from the USDA to support its plan to build a 55 million gal/year biorefinery in Greene County, Alabama.
Coskata has been operating a pilot plant since the Fall of 2009 in Madison, Pennsylvania (just outside of Pittsburgh) where it turns wood chips into ethanol. Here’s how I described the firm’s process when I visited the plant:
Converting feedstock to ethanol at the plant is a three-step process. The tour group observed wood chips being sucked out of a 500-lb bag and into a feed handler and then being sent to a gasifier. Ionized gases at temperatures of up to 2,500 °C vaporize the feedstock into a synthesis gas composed primarily of carbon monoxide and hydrogen.
The syngas is then cleaned and cooled; waste heat from the hot gas is used to turn a turbine and provide electricity to the plant. The cooled gas is piped to a series of bioreactors, where specially designed microbes feast on it and excrete ethanol. The microbes are a type of Clostridia bacteria that have been selected to produce only two-carbon alcohols, meaning Coskata does not have to separate ethanol from methanol.